DEAR GEORGE:

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP81B00878R001400090287-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 1
• Document Creation Date: December 20, 2016
• Document Release Date: October 16, 2007
• Sequence Number: 287
• Publication Date: February 4, 1957
• Content Type: LETTER

Approved For Release 2007/10/19: CIA_ RDP81 B00878R001400090287-5 SAPC
4 February 1957
CMCC Doc. No. 151X5.416
Copy / of 2
Page 1 of 1
Dear George:
We have now settled all purchase orders affected by the System 2
quantity cutback. In no cases was it necessary to go into formal term-
ination proceedings, and no DD541's were executed. Completion of work
reinstated to make the revised quantities of equipment covered all vendors
except the Kenneth C. Holloway Company, who fabricated the cabinet
assemblies for the ground equipment on our Purchase Order 25-287-13. In
a few cases there were modest price increases reflecting the additional
start-up costs when the order was reinstated, but all of these seemed
reasonable to us and were covered by purchase order changes.
In the case of the Kenneth C. Holloway Company, all quantities of
the original order were reinstated in two steps, August 29 and December 28,
except for three dual cabinets. Price increases of about 4-1/2% were
negotiated on the reinstated orders for a total increase of $1,265. 86. These
price increases seemed very reasonable. Most of the work had been done
on the three cancelled dual cabinets short of final assembly. They have
been shipped to us as parts and pieces, and we negotiated a revised price
with the vendor agreeing to a settlement of $984. 60 per assembly versus
the original price of $1, 336. 55. This settlement avoided a termination
claim. and any costs involved in the preparation of DD541's. The total price
of the purchase order after the adjustment was $26, 296. 97 versus $26, 086. 96
in the original commitment or an increase of $210. 01.
We believe this to be an equitable settlement since the vendor com-
pleted the original, order except for the three cabinets mentioned, and the
delay in reinstatement of his order certainly involved increased cost for
him on that portion of the work which was reinstated.
Your approval is requested for this settlement.
Sincerely,
k y ...~ ET 'fir.. cf h U r d S; T s wi.hi h me ing of tha
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Approved For Release 2007/10/19: CIA-RDP81 B00878R001400090287-5